Mitt Romney Knows About Crony Capitalism


Mitt Romney has been playing the crony capitalism card lately, talking up the Solyndra stimulus-money debacle and falsley accusing the Obama administration of lining the pockets of “friends and family.” But it turns out that Romney may need to take a long, hard look in a mirror:

When Romney was governor, the state handed out $4.5 million in loans to two firms run by his campaign donors that have since defaulted, leaving taxpayers holding the bag.

The two companies—Acusphere and Spherics Inc.—stiffed the state on nearly $2.1 million in loans provided through the state’s Emerging Technology Fund, a $25 million investment program created while Romney was governor in 2003 that benefitted 13 local firms.

Acusphere, a biotechnology firm headed by a Romney campaign donor, got $2 million in 2004 that it was supposed to put toward a $20 million manufacturing facility in Tewksbury, which never became fully operational…

The loans were approved by a seven-person advisory board that included two Romney appointees and three Romney campaign contributors, a Herald review found.

Meanwhile, stimulus funds have actually been remarkably well managed. Michael Grunwald at Time’s Swampland blog writes:

The Department of Energy has handled $37 billion in stimulus money, more than its annual budget. Overall, the federal government has distributed over $800 billion in stimulus money. Where are the sweetheart deals? Where are the actual outrages that are provoking outrage? During the debate over the stimulus, experts warned that as much as 5% to 7% of the stimulus could be lost to fraud. But by the end of 2011, independent investigators had documented only $7.2 million in fraud, about 0.001%. As I’ve written, reasonable people can disagree whether the stimulus was a good thing, but it’s definitely been a well-managed thing.

If you want to talk about actual crony capitalism at the federal level, the problem isn’t so much a vast conspiracy as it is a magnificently complex web of elected officials who want to keep their own jobs by keeping jobs in their home districts and states. That bland reality makes the real problems with more equitable spending at the federal level even more intractable.

Meanwhile, Romney’s broader argument against the stimulus is incoherent. He blasts Obama for job losses during his administration, but under a Romney administration during that same period of economic crisis, with no stimulus money, job losses almost certainly would have been much more severe. There’s a time for austerity, and it isn’t during a recession.

HERE ARE THE FACTS:

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ONE MORE QUICK THING:

Our fall fundraising drive is off to a rough start, and we very much need to raise $250,000 in the next couple of weeks. If you value the journalism you get from Mother Jones, please help us do it with a donation today.

As we wrote over the summer, traffic has been down at Mother Jones and a lot of sites with many people thinking news is less important now that Donald Trump is no longer president. But if you're reading this, you're not one of those people, and we're hoping we can rally support from folks like you who really get why our reporting matters right now. And that's how it's always worked: For 45 years now, a relatively small group of readers (compared to everyone we reach) who pitch in from time to time has allowed Mother Jones to do the type of journalism the moment demands and keep it free for everyone else.

Please pitch in with a donation during our fall fundraising drive if you can. We can't afford to come up short, and there's still a long way to go by November 5.

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